Company Transitioning Ownership and Entering New Growth Phase

Challenge

Successful closely held specialty engineering company with operations in multiple states transitioned ownership to a 100% employee owned fully leveraged ESOP. It had also just acquired two smaller firms to expand its geographic footprint and needed to integrate operations.  The company was using the cash basis of accounting but annual ESOP valuations necessitated US GAAP accrual accounting. The company was also transitioning leadership from the original founders and needed a line of credit. Accounting and financial matters were being handled by senior management with little financial experience and control procedures were lacking and undocumented.  The company needed a a part-time CFO to establish structure and processes to meet its growth objectives and establish bank financing.

Solution

Performed a baseline analysis and documented accounting procedures and controls. Converted from cash basis to US GAAP accrual basis accounting, and provide cash and operations forecasting and budgeting. Initiated monthly project reviews to monitor and enhance project performance. Developed a plan to better integrate and control acquired operation. Successfully negotiated a line of credit for operations and long-term financing for a potion of ESOP redemption. Provide quarterly compliance reports, and monitor covenants as required by the bank. Manage CPA review of year-end financial statements and tax return, and prepare financial data and forecasts for the annual ESOP valuation. Facilitate an organization and planning process to meet strategic objectives and provide coaching to accelerate the transition to next generation leadership. Company has increased its valuation by 10x and successfully managed its redemption financing. Serve as a member of the Board of Directors and a co-trustee of the ESOP Trust.